Over the last couple of years, growth rates have begun to slow down in mature markets. Retailers had to look past their borders to discover sustainable opportunities that enable them to meet growth targets. For instance, the company Toys R Us declared bankruptcy. While numerous expansion endeavours have generally focused around new brick and mortar store openings, retailers have as of late shifted to another growth engine by entering global markets through e-commerce.
There has never been a better time to start considering your e-commerce strategy. In 2015 worldwide B2C online sales was relied upon to grow 17.7% to US$1.771 trillion. Advance to 2017, and you can expect to see global online sales of over $2.3 trillion. The quick development of the Internet and utilization of cell phones in developing markets is a significant part of the reason online business is growing, alongside better payment alternatives and advanced shipping.
Digital Connectivity Boosting E-Commerce Platforms
In the meantime, connectivity is growing explosively all around. Around three billion individuals have Internet access today. 2020 estimates vary from about four billion to as high as 7.5 billion. Indeed, even at four billion, penetration growth of 33% combined with even modest per person growth will be transformative. A current report recommends the worldwide business-to-customer cross-border e-commerce market will reach $1 trillion in 2020.
On the off chance that you look further at the data, what you see is that while sales in North America (US and Canada markets) are developing, it’s not at the rate that online sales are growing in emerging regions, for example, Asia-Pacific. Online business expands altogether in the BRIC nations – Brazil, Russia, India and China, with China alone projected to outperform the US e-commerce market.
In the present competitive marketplace, e-commerce gives a lower risk, a faster avenue to enter, test, and infiltrate global markets. When properly executed, this customer-centric approach will go a long way to differentiate brands and build customer loyalty.
A rise in Innovation and Technological Advancements
While innovation and mobile adoption continue, the rise of all-in-one logistics providers reinforces worldwide competition by levelling the playing field for international shipping and transaction processing. In the case of building an omnichannel approach or simply testing another market, the urgency for a comprehensive and well-planned global digital commerce strategy is clear.
As worldwide markets display dynamic growth opportunities, retailers become increasingly eager to test new markets. Also, they complement an existing physical presence with an e-Commerce channel. Multiple entry options require changing levels of investment and risk, at the end of the day, the chosen entry method should rely upon the preferred means for shopping by target clients, the strategic priority of the market, and in addition the overall cross-channel expansion strategy.
Developing markets may show the biggest opportunity, yet they may also be the hardest markets to crack, considering social contrasts and government compliance complexities. If so, entering through an established eCommerce player might be a viable option. Retailers choosing this entry point take advantage of existing infrastructure, secure payment systems. Moreover, it provides simplicity of driving traffic, but may not have as much control over the brand.
Digital Expansion Strategies
Organizations should jump on this. Numerous bricks-and-mortar organizations lost ground to e-commerce companies by being slow to create in-country online strategies. They should not miss the international boat, regardless of the possibility that it implies working hard on in-country and cross-border e-commerce in parallel.
As e-Commerce markets in Asia, South America, and Eastern Europe keep outpacing their mature counterparts in the US and Europe. Retailers should concentrate on the significance of utilizing eCommerce as a growth driver to reach new markets. E-Commerce enables retailers to connect with new clients. In addition, it gives a chance to better understand new markets through low risk, low cost, test-and-learn digital expansion strategies. Therefore, enabling retailers to penetrate the markets with the highest growth potential.
Written By: Vic Bageria
CEO / CVO
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